updated 11:20 am EST, Wed February 4, 2009

TWC Data Caps Spread

Time Warner during a financial results call today revealed that its experiment in metered data use on its cable Internet service should expand to new areas in 2009. Without entering into specifics, the company's cable chief Glenn Britt says that more cities will be subject to the program, which charges users for usage at fixed intervals up to a 40GB cap. It's unknown whether the feature represents a larger trial or a formal rollout.

While Time Warner has never publicly discussed the likelihood of making the caps permanent, the limits have been labeled unrealistic by critics who point to even Comcast's 250GB cap as more practical. A 40GB cap would limit users to at most 10 HD movies per month using networked media hubs like the Apple TV assuming the user does nothing else during the period, discouraging them from using Internet video. No mention has been made of a change to the caps or an overage fee that would let frequent users keep using the service beyond the cap.

Concerns have been raised by Alley Insider and others that too-low caps without reasonable overage fees may draw fire from regulators at the FCC, who may see the caps as deliberate attempts to push customers towards cable video options rather than letting users opt for Internet-based video that includes legitimate options like Hulu or iTunes.

This is a good example of why the cable company's video-on-demand services should be treated as data tranmissions and subject to net neutrality rules. They shouldn't be able to cap, throttle, charge extra for access to other online video services while allowing free, unlimited access to their own video download services.

I went DirecTV years ago....Time Warner was all for raising rates constantly, but they don't want to put money toward infrastructure improvement. What will they do when digital release becomes the norm rather than the exception? I guess they'll just wait until enough people complain, then raise rates to cover "Infrastructure Improvements" I can't wait until my municipality is fully fibre.

I'm using TimeWarner NYC and I'm sure I must download around 120GB a month, easily. Between torrents and newsserver use I can easily download 4 or 5 GB in movies and dramas every day. A cap of 40GB would be devastating. No FiOS available in my ghetto area, either. And I'm not expecting it anytime soon. I'll hate to give up my 8-year-old email address when I kiss TimeWarner goodbye. Their cable sucks when it comes to TV and now they're going to try to ruin my internet service with a data cap. Those SOBs.

Pushing cable video options is exactly what Time Warner will do. Just wait and see.

But what you're seeing here is the corporate version of natural selection. When you do something this stupid, it comes back to bite you in the butt.

When they eventually lose all their subscribers due to bandwidth caps/limiting (because everything, including TV will eventually be IP based) and all their customers jump ship to other providers, TWC will go belly up and this will all be a footnote in history (and a lesson future companies will once again fail to learn).